Saturday, July 5, 2008

Customer Service in the Age of Social Media: A Lesson from Hewlett Packard

Providing poor customer service has always been a dangerous proposition for brands. Failing to meet consumer expectations damages brands, but pre-2005 (before social media began to explode) the risks were relatively small. Any single service event could have destroyed brand loyalty for a single consumer and perhaps may have caused ripples with a few people that consumer knows, but really damaging a brand's reputation before the age of social media required significant, consistent, and long-lasting service failures.

Today the game has changed and any single service event can become a PR disaster of national proportions. Hewlett Packard is the latest brand to learn this. As broadcast on CrunchGear, one of the most influential sites among tech-savvy consumers, an HP customer sent his computer that was still under warranty to HP for service. He received a communication indicating that when a tech opened his computer, fluid spilled out and onto a motherboard, so HP claims the consumer owes them $1,099 to repair or replace their motherboard.

Pre-2005, this consumer's complaint would've been heard by a few dozen people at most. Today, CrunchGear's 34,000 daily visitors now know about HP's rather ridiculous and embarrassing customer service gaffe. As noted on CrunchGear, "I’m sure that for every experience like this, there are a thousand perfectly good interactions with HP’s customer service, but that doesn’t reduce the impact when you hear something as ridiculous as this."

Of course, no company ever believes it is providing poor customer service, but they certainly do seek to balance the level of service versus cost. For example, each organization reaches its own decision on questions such as the cost of adding more customer service reps versus the lost goodwill that occurs when consumers are forced to wait on hold and abandon their calls.

As HP's experience shows (and other brands have also found), social media is changing the way we must think about customer service. The cost of poor service, once measured in single consumers, can now have an immediate impact far and wide.

It should go without saying that the answer isn't to solve every consumer's complaint at any expense required. This is not an effective or even plausible solution. However, improving customer service is no longer a question of just limiting costs but one of enhancing brand equity.

Improving customer service in 2008 requires actions that are both traditional and innovative. As always, it is vital to hire, train, and monitor customer service employees. Each must understand what the brand is about, why their interactions with consumers are important, and what is expected of them. We don't know what happened in the HP example, but it seems obvious an employee or group of employees lacked an awareness of what is acceptable and what is not.

Providing customer service that creates a high-quality customer experience requires even more in 2008 than in the past. How is HP using social media to engage consumers where they are already spending time and discussing their brand experiences with others?

For example, just a couple hours ago a consumer on Twitter warned others that they shouldn't "use HP Premium or Pre.Plus papers as they're meant ONLY for Dye printers, no matter what HP says." If HP was on Twitter, they could address this concern or correct the bad information. They could also be participating in the dialogs underway about HP's new TouchSmart technology, which is seeing some positive buzz on Twitter. Alas, HP seems to be nowhere to be found on Twitter, so they are not part of the consumer discussions.

Another way HP can use social media is to be aware of problems and to address them before they become PR disasters. Let's see how they respond to today's post on CrunchGear. Will they be unaware of this issue until it is viewed hundreds of thousands of times and is shared across dozens or hundreds of blogs? Or are they monitoring social media and prepared to take action to either make this consumer happy or to fight what may be incorrect information with positive and proactive communications?

Brands can no longer wait until an issue hits mainstream media to react, nor can they rely on their positive relations with editors at a few media outlets to help protect their brand. Social media is changing the way brands must manage and monitor their brands.

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About Experience: The Blog

The world is changing rapidly, both for consumers and brands. Consumers are more empowered than ever before and traditional business models are under attack.

In an increasingly social, mobile and real-time world, brands are created not by the messages they broadcast but by the experiences they offer--ones that create empathy, build trust, earn loyalty, spur Word of Mouth, encourage collaboration, and provide ever greater value to customers in innovative ways. On this blog, we explore how brands are built and business improved via Customer Experience Management, purposeful corporate culture, social and mobile business strategy and collaborative economy models.

You are welcome to participate, criticize, praise, critique, expand, or correct the information and opinions found on this blog. Spam, off-topic, or crude comments will be deleted, but all others are welcome.

About the Author

I am Augie Ray, Research Director covering customer experience at Gartner. I conduct and publish research and advise Fortune 500 clients on the value, process, measurement and tools of customer experience. This includes topics such as Voice of the Customer (VoC), personas, customer journey maps, CX governance, and customer experiences metrics that are leading metrics of brand success.

Previously, I was Director of Global Voice of Customer Strategy for a Fortune 100 financial service company. My background includes more than 20 years of experience in digital, brand, customer experience and social media.

In the past, I led social business at USAA, a firm recognized for its innovative use of communities and social customer care within the financial service industry. I also consulted and published analysis as a Forrester analyst covering digital marketing and social media. In addition, I led a diverse $9 million agency team with specialties in digital development, digital experiential marketing and community strategy.

The future will bring a great deal of innovation that offers opportunities to organizations that are agile and willing to cannibalize their own business models (but it will severely challenge those organizations that cannot.)

The views expressed on this website/blog are mine alone and do not necessarily reflect the views of my employer.